Comcast-NBCU: View From the Top

8/03/2010 12:30 PM Eastern

By: John Eggerton

Washington — Two key executives from Comcast
and NBC Universal, speaking on the condition of anonymity,
last week offered some background on where
vetting of their joint-venture deal by the Federal Communications
Commission and the Justice Department
stands. Here are the highlights, both paraphrased and
in direct quotes.

WILL THE DEAL GET DONE?

The executives said they are confident it will be, with
no additional conditions that could stop it.

WHEN?

The execs said it is “on track” to close by the end of the
year. “All the communications we have had out of the
Justice Department and the FCC are that they are very
focused on that original schedule that came out of discussions
with both,” one said.

The FCC shot clock would peg the FCC’s deadline as
the day after Thanksgiving, according to Comcast, but
that clock is not official.

Justice has 60 days after the two companies have
completed production of a second request for information,
Comcast said. The request has been made, but
Comcast has not pushed, and Justice has not declared
that the second review is yet complete. Justice has no
formal clock, but it has discussed an informal schedule
that has the review completed before the end of
the year.

HOW VIGOROUS IS THE VETTING?

The Justice Department has been equally as diligent
and engaged, the executives said, as the FCC, “which
is a little bit different than what we have experienced
in the past.” That diligence has included depositions of
both Comcast and NBCU execs — under a dozen on either
side, they said, calling it on par with past reviews.

WHAT ARE THE WITNESSES BEING ASKED?

No comment, but “we have not been surprised by any
of the issues that have been identified as of interest, and
neither would you be.” They added: “Video over the Internet
is clearly going to be a matter of discussion.”

UNDER WHAT CONDITIONS WILL IT PASS MUSTER?

The executives said the NBCU joint venture will be
bound to the public-interest conditions Comcast and
NBCU offered up when the deal was announced and
to the side deals with affiliates, minority groups and
producers they have struck since then.

They said some of those agreements would be hard to
write up as conditions, but enforcement will be a combination
of FCC conditions — several of the NBC affiliate related
deals, for instance — and binding agreements
between the parties, as spelled out in the individual
agreements.

CONDITIONS WERE ‘EASY’

They said the conditions they agreed to were either
consistent with the way they already conducted their
business or things they were already planning to do.
“It was easy for us to agree because it was just a way
for us to make them feel better about the transaction
without us giving up anything in terms of our contemplated
operation of the combined Comcast/NBCU.”

ANY MORE CONDITIONS?

The execs would not rule them out: “We’re not good at
drawing lines in the sand and saying, ‘We’re finished,
we’re done.’”

They said they feel the conditions are a “comprehensive
set,” but are willing to have discussions with Justice,
FCC or others about “open items,” including any additional
conditions.

JUST HOW FAR CAN COMCAST/NBCU GO?

“We would push back very hard on any conditions that
would get in the way of our ability to operate either of
our businesses separately or together as a combined
company.”

ANY FEEDBACK YET FROM FCC OR JUSTICE?

No, but Comcast and NBCU are expecting to start getting
informal feedback by summer’s end in the form
of staff -level meetings first, then commissioner meetings,
then formal feedback from the FCC chair and the
Assistant Attorney General level at Justice.

ON CRITICISM OF THE DEAL

“The expected group of opponents making the expected
arguments against the transaction. In fairness,
we have made the expected arguments in favor
of it.” There was “a lot of input from diversity groups,
but agreements [were] reached” with a number of
them, and talks are ongoing with Rainbow/PUSH
and the NAACP.